- The White House is launching initiatives to boost affordable housing, including a new $100M program.
- Treasury Secretary Janet Yellen remains focused on the housing supply shortfall, and aims to expand the Low-Income Housing Tax Credit.
- The new initiatives are meant to counteract record-high home prices and ongoing high interest rate challenges.
As reported on The Hill, the Biden administration unveiled new measures to boost affordable housing in response to rising housing and rent costs.
According to the Associated Press, Treasury Secretary Janet Yellen announced the initiatives on Monday, emphasizing the importance of addressing the longstanding housing supply shortfall.
What’s Being Proposed
The Treasury Department’s announcement highlights several new steps to strengthen affordable housing programs and policies. Among these initiatives is a new program that will allocate another $100M over the next three years to support affordable housing funding.
Additionally, the administration is urging Federal Home Loan Banks to increase their spending on housing programs.
Yellen also called on Congress to pass bipartisan legislation to expand the Low-Income Housing Tax Credit, a crucial tool for financing affordable housing. She also pressed state and local officials to remove legal hurdles to housing development.
Broader Implications
This announcement comes amid record-high home prices. In May, the median price of sold homes reached $419.3K, 6% higher YoY and the largest gain since October 2022.
The surge in home prices is compounded by the Federal Reserve’s decision to maintain interest rates at a 23-year high of 5.25–5.5%.
Future Outlook
The Biden administration’s new measures to boost affordable housing couldn’t have come sooner. High rates have strained affordability, making these initiatives timely.
But only time will tell how much these new measures will cut into the supply shortfall, and whether they will make housing more accessible to a meaningful number of low- and middle-income Americans.
